Auto companies, including the Detroit Three,reported strong combined sales of 1.2 million vehicles sold last month -- an 11 percent increase from October 2012, but a tad bit lower than what some analysts predicted.

“This was a really interesting month. Probably one that hasn’t seen such volatility in quite some time,” said Jessica Caldwell, Edmunds.com senior analyst. “It definitely had a lull when the government shutdown went longer than people anticipated.”

Caldwell said October sales picked up as soon the shutdown in Washington, D.C. ceased, but sales didn’t end October as strong as they have in previous years.

Coming off of a slow September, the Detroit automakers had a particularly good month though. Each of the automakers reported double-digit gains in October, led by General Motors Co. up 16 percent; Ford Motor Co. up 14 percent and Chrysler Group LLC up 11 percent.

Each of the Detroit automakers reported double-digit gains in October, led by General Motors Co. up 16 percent, followed by Ford Motor Co. up 14 percent and Chrysler Group LLC up 11 percent.
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“We think it’s safe to say that we exceeded most people’s expectations from a volume standpoint,” said Kurt McNeil, GM vice president, U.S. sales operations, during a conference call Friday morning. “No one product or segment drove our results. We had strong sales in every market segment where we compete.”

Overall, the Detroit Three sold 558,470 vehicles in October, a 14 percent increase from October 2012. Through the first 10 months of the year, the three Detroit automakers have sold more than 5.9 million vehicles, a nearly 10 percent increase from the same time a year ago.

Foreign automakers last month were led by Nissan with a 14 percent increase to more than 91,000 vehicles, followed by Toyota up 9 percent; and Hyundai and Honda up 7 percent each. Of major automakers, only Volkswagen's sales fell.

The Detroit automakers continue to have strong sales thanks to the pickup truck and sport utility vehicle market, which seasonally sell well toward the end of the year and was up 16 percent compared to last year, according to Autodata Corp..

But as large vehicle sales grew, sales of more fuel-efficient vehicles stalled out in October.

2014 Ford F-150 TremorFord

In the small to mid-size car segment, some major entries like the Chevrolet Cruze and Ford Focus experienced double-digit year-over-over declines. Ford's small cars -- the Focus and C-Max hybrid -- dropped by about 20 percent.

Truecar.com senior analyst Jesse Toprak said a bit of the sales declines in small cars is seasonal, but they’ve also been “oversold” in the past three years following the recession.

“There’s this reversal to larger vehicles,” he said. “The explanation for that is gas prices have been going down quietly the last couple of months, and add to that the affordability of vehicles … it’s essentially making larger, more expensive vehicles more affordable to consumers on a monthly payment basis and skewing the demand a bit.”

Plug-in electric vehicles also short circuited, including a 21 percent decrease in Ford C-Max and 32 percent decline in Chevrolet Volt sales. The Toyota Prius plug-in experienced a modest 7 percent increase from October 2012 to about 2,100 vehicles sold last month.

“The most likely culprit responsible for the decline is gas prices and enticing traditional gas-powered vehicles that achieve 40 mpg plus,” said Edmunds.com senior analyst Michelle Krebs. “With fuel prices expected to fall further, the auto industry will be watching carefully to see if the pattern continues.”

Led by pent-up demand, as the average age of a vehicle on the road right now nears 12; low interest rates; and arguably the best U.S. product portfolio in history, automakers and industry experts remain bullish about the industry in the short- and long-term.

October’s annualized selling rate (also referred to as the SAAR or Seasonally Adjusted Annual Rate), last month was 15.2 million.

“If you look at the SAAR range for the year, it’s been one of the most stable we’ve seen in the history,” Toprak said. “It tells you that no matter what happens, people kept buying cars this year, which is good news in terms of the health of the industry.”

Many automakers and experts have upped their yearly sales estimates from the low- to mid-15 million ranges to around 15.6-15.9 million vehicles.